Nestlé plans to further raise product prices, ends commercialization of frozen meals and pizza in Canada

SWITZERLAND – Nestlé, the world’s largest food & beverage company, intents to raise the prices of its food products further this year to offset higher products to offset higher production costs that it has yet to fully pass on to consumers.

Chief Executive Mark Schneider told a German newspaper Frankfurter Allgemeine Zeitung in an interview that its latest price increases will not be as steep as they were in 2022, but “they have some catching up to do over the full year.”

In the first nine months of 2022, the maker of KitKat chocolate bars and Nescafe reported organic sales growth of 8.5%, of which price rises accounted for 7.5 percentage points.

At the same time, Nestlé is planning to wind down its frozen meals and pizza business in Canada over the next six months driven by its strategy to focus on categories that support long-term business growth and allow for reinvestment, especially in ‘priority categories’.

The frozen products on the list are pizza brand Delissio and prepared meal brands Stouffer’s, Lean Cuisine, and Life Cuisine.

John Carmichael, the CEO of Nestlé’s Canadian arm, said: “Nestlé Canada attributes much of its long-term success to its ability to adapt and evolve within the industry. This decision enables us to further invest in priority categories. We remain open to enhancing our portfolio where it makes sense for our business.”

In a statement, the Canadian unit of Swiss multinational food and drink processing conglomerate corporation said the priority categories are: confectionery; coffee and beverages; ice cream; infant foods and supplements; health science products; food service; waters; and pet food.

Nestlé does not have a factory in Canada that manufactures any of its frozen meals or pizza products. The Canadian arm which employs 3,700 people in 12 locations, manufactures and/or distributes brands in Canada, including Kit-Kat chocolate, Haagen-Dazs ice cream, Nescafe coffee, and Perrier water.

Meanwhile, a Swiss German-language newspaper NZZ has reported that Nestlé continues to sell and produce a wide range of food products, as well as recruit staff in Russia, despite its announcement that it would reduce its range of products in the country to “essential” goods such as baby milk on a wake of Russia’s war on Ukraine.

The NZZ observes that there are no indications that local Nestlé factories have stopped production or carried out ‘major rounds of layoffs’.

According to the newspaper, Nestlé’s Russian subsidiary seems to be continuing to recruit staff with 110 Nestlé Russia vacancies advertised on the Headhunter portal, one of the country’s most important online job portals.

In addition, the article also noted that there is no shortage of foreign brands available at shops despite an exodus of Western companies triggered by the war.

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